Description

This paper estimates the size of the informal economy for 32 mainly Latin American and Caribbean countries in the early 2000s. Using a structural equation modeling approach, we find that a stringent tax system and regulatory environment, higher inflation, and dominance of the agriculture sector are key factors in determining the size of the informal economy. The results also confirm that a higher degree of informality reduces labor unionization, the number of contributors to social security schemes, and enrollment rates in education.

Taxonomy

Economic policy , Education , Inflation , Monetary policy , Social policy , Social security

More publications in this series: Working Papers

More publications by: Guillermo Javier Vuletin